Obama reignites warnings to plan for coal’s decline

CHARLESTON, W.Va. -- President Obama's proposed climate change action plan has reignited rhetoric about an administration "war on coal," but it's also renewed calls for West Virginia political leaders to focus on efforts to diversify the state's economy as the coal industry continues its ongoing decline.

Last week, Obama announced a broad effort to curb global warming pollution that includes the first-ever rules to limit carbon dioxide releases from power plants that account for a third of the nation's greenhouse emissions.

Elected officials across West Virginia generally blasted the plan. Rep. Nick J. Rahall called it misguided, misinformed and untenable." Rep. Shelley Moore Capito, R-W.Va., called it "another move in the president's tyrannical game of picking winners and losers in the energy industry."

However, many energy experts said such reactions indicates how out of touch the state's political leadership is to growing recognition of the urgency to take action to try to slow climate change.

"It just sort of highlights that we're not part of the movement around the country that is addressing this," said James VanNostrand, a law professor and director of the Center for Energy and Sustainable Development at West Virginia University's College of Law. "We're on the sidelines, watching and waiting for it to happen."

While limiting emissions from coal-fired power plants is one key part of Obama's proposal, the president also announced a wide variety of other efforts: Pushing for more production of cleaner-burning natural gas; increasing programs to improve energy efficiency; and even pumping substantial federal money into finding ways to control carbon emissions from coal-burning facilities.

VanNostrand said many of those items and other measures could be part of a more thorough West Virginia energy policy. As one example, VanNostrand said the state could put more emphasis on encouraging the co-firing of coal plants with waste wood and other biomass that helps lower carbon dioxide emissions.

A study published last week in the Proceedings of the National Academy of Sciences concluded that West Virginia remains a good target for more wind-power facilities because wind energy built here is more likely to displace coal than wind generation built elsewhere.

"A wind turbine in West Virginia displaces twice as much carbon dioxide as the same turbine in California," said the study, authored by researchers at Carnegie Mellon University.

Bill Raney, president of the West Virginia Coal Association, complained last week that Obama's climate change action plan includes "imminent restrictions on carbon emissions" from coal-fired power plants. However, administration officials say carbon dioxide rules for existing plants won't be finalized for another two years and, even then, they almost certainly will have some sort of lengthy phase-in for utility compliance.

Officials from American Electric Power, one of the nation's largest coal-burning utilities, praised Obama for offering a "balanced approach" but said the exact carbon dioxide limits and the compliance timelines are a key piece of information that's not yet known.

"As with any plan, the details will make the difference," said AEP spokeswoman Melissa McHenry. She added that, "our industry can continue to achieve meaningful reductions and minimize economic pain" if the administration provides "maximum flexibility."

As part of its plan, the Obama administration would provide $8 billion in new loan guarantees for fossil-fuel projects, including those that focus on carbon capture and storage, or CCS, for coal-fired power plants. That's on top of the $3.4 billion for CCS that was included in Obama's economic stimulus bill.

While coal supporters and many scientists believe CCS technology can be part of the solution to climate change -- and really the only answer for reducing carbon dioxide emissions and still burning coal -- there are major questions about the cost, scale and feasibility of equipment that would need to be installed on power plants around the world.

During a radio appearance last week, Rahall noted the administration's investments in CCS but said the U.S. Environmental Protection Agency shouldn't issue rules to limit emissions until CCS technology is ready to be more broadly deployed.

"We need to give industry the time for new technologies to be finalized and kick in that would reduce carbon dioxide emissions," Rahall said on the MetroNews show "Talkline."

Many scientists and policy experts, though, have concluded that climate change regulations need to be "technology-forcing," meaning that utilities won't perfect and deploy the technology until government regulators require them to do so.

Last month, a Congressional Research Service report noted that utilities dropped three major CCS projects that received $729 million from Obama's stimulus program, at least in part because of "uncertainty regarding future regulations and uncertainty regarding the future national climate policy."

One of those projects was AEP's much-touted plan to expand a CCS test at its Mountaineer Plant in New Haven, Mason County.

At the time, then-AEP CEO Michael Morris called his company's decision a "classic 'what comes first?'" situation.

"The commercialization of this technology is vital if owners of coal-fueled generation are to comply with potential future climate regulations without prematurely retiring efficient, cost-effective generating capacity," Morris said. "But as a regulated utility, it is impossible to gain regulatory approval to recover our share of the costs for validating and deploying the technology without federal requirements to reduce greenhouse gas emissions already in place."

While its backers say CCS is a vital area for West Virginia to explore, others point to a variety of studies and projections that show that, regardless of climate change rules, coal production in Southern West Virginia is likely to continue to decline because of played-out reserves, continued low natural gas prices and competition from more productive mines in Wyoming and Illinois.

In a May report, the Morgantown-based environmental consulting firm Downstream Strategies projected that coal production in Southern West Virginia and the rest of Central Appalachia would drop by 53 percent between 2011 and 2040.

"It is vital that public officials begin making the political and financial investments necessary to build the foundation for new economic development opportunities in coal-producing counties," said Rory McIlmoil, the report's lead author.